The biggest maker of antivirus tools issued a revenue
forecast that topped projections. Sales in the fiscal first
quarter will be $1.65 billion to $1.69 billion, the company said
in a statement yesterday. Analysts, on average, are predicting
revenue of $1.64 billion for the period that ends in June,
according to data compiled by Bloomberg.

Spending on security software and equipment is on track to
increase 9.1 percent this year to $71.7 billion, according to
Gartner Inc. The forecast buys the struggling company time as it
deals with a management transition and a market that is shifting
to smartphones and tablet computing, where security tools aren’t
as widely used. Two chief executive officers have left in as
many years, and the company has hired bankers to explore
strategic options and defend against activist investors.

“They still have a real story to tell around security,”
said Patrick Walravens, an analyst at JMP Securities in San
Francisco who has the equivalent of a buy rating on Symantec
shares. “They’re still the No. 1 player in the space -- that
gives them a lot of advantages.”

Symantec rose 3.3 percent to $20.79 at the close in New
York. The stock is down 12 percent this year, while the Standard
& Poor’s 500 Index is up 1.6 percent.

For the fourth quarter, which ended March 28, net income
rose to $217 million, or 31 cents a share, from $190 million, or
27 cents, a year earlier. The result for the recent period
included a $22 million charge related to the restatement of
income from some contracts over the past three years.

Grade: C+

Revenue fell 7 percent to $1.63 billion. Sales declined in
each of Symantec’s key business units -- consumer security,
business security and data storage -- yet profit rose because of
lower costs, helped by job cuts. Sales and marketing expenses
were 16 percent lower than last year at $584 million.

“Overall you’d call it a C+ type earnings, but that’s what
investors were expecting,” said Daniel Ives, an analyst at FBR
Capital Markets & Co. in New York who has the equivalent of a
hold rating on the stock. “They cut their way to show better
performance on the bottom line. You can’t cut your way to
growth; that continues to be the issue.”

Profit, excluding items, will be 41 cents to 43 cents a
share in the current quarter, Symantec said, compared with the
analysts’ average estimate for 43 cents.

Under Pressure

Symantec is under pressure to break up the company as
demand slows for antivirus software, which is now widely seen as
incapable of catching all but the easiest-to-find attacks.
Symantec is hiring JPMorgan Chase & Co. to explore its strategic
options and defend against activist shareholders, people with
knowledge of the matter said last month.

The company is evaluating the performance of all its
business lines as it looks for areas to cut, Michael Brown,
Symantec’s interim CEO, said in an interview. Any job cuts would
be isolated to specific products and wouldn’t be companywide, he
said.

“We feel like there’s a lot more to do at the company,”
he said. “We’re already well-positioned -- with deep technology
breadth and scale -- and we’re in markets that are growing.
We’ve tried to do too much. We’ve tried to invest in too many
things.”

Symantec fired CEO Steve Bennett in March after less than
two years on the job. His ouster came amid a sales slowdown and
after the departure of top executives including Chief Financial
Officer James Beer and Francis deSouza, president of products
and services.

Share Buyback

Bennett, who previously was CEO of TurboTax software maker
Intuit Inc., had cut 1,000 jobs, or 5 percent of staff. He
engineered a restructuring of Symantec’s sales force that was
meant to help restart growth and instead disrupted customer
relationships. Bennett had replaced Enrique Salem, who was
ousted in July 2012. Both executives resisted pressure to sell
Symantec’s data-storage business, which Symantec entered with
its $10.2 billion acquisition of Veritas Software Corp. in 2005.

Symantec said it bought back $125 million worth of its
shares in the latest quarter and has $658 million remaining for
stock repurchases.